Category Archives: International

John Steele Gordon – A Thread Across the Ocean: The Heroic Story of the Transatlantic Cable

John Steele Gordon – A Thread Across the Ocean: The Heroic Story of the Transatlantic Cable

The story of Cyrus Fields, a 19th century entrepreneur who laid the first transatlantic cable. Fields was a man of rare persistence. As Gordon puts it on page 12, “But it was Cyrus Fields alone who made it happen, for he served the same function in the enterprise of the Atlantic cable that a producer serves in a theatrical production. A producer does not act or direct or design scenery. But without him, neither does anyone else.” Fields was around at the right time—but he also the right person.

Telegraphy had been around for a bit by the time Fields got started, and people had also figured out that it was possible to lay cable underwater. Earlier initiatives had crossed the English channel, and of course the U.S. had a transcontinental cable over land. But Fields’ grand project required a new suite of innovations everywhere from sea exploration, knowledge of water physics, electric conductivity, cable insulation, ballast and weight for ships, diplomacy, and international finance. Fields, often through sheer force of will and personality, headed up a multi-year effort using  massive amounts of capital to successfully finish the project. There were numerous setbacks, and the on-the-ground (water?) problem-solving his ships’ crewmembers were able to improvise, at times during hostile weather, are both impressive and inspiring.

Fields paved the way for today’s transoceanic cables capable of carrying not just phone calls, but Internet traffic, video communications, and more around the world. As heroes of invention go, Fields deserves a much more prominent place on the list.

S. Frederick Starr – Lost Enlightenment: Central Asia’s Golden Age from the Arab Conquest to Tamerlane

S. Frederick Starr – Lost Enlightenment: Central Asia’s Golden Age from the Arab Conquest to Tamerlane

It’s fairly well known that the Islamic world preserved classical texts during the dark interlude between Rome and the Renaissance. Plato’s dialogues, Aristotle’s taxonomies, and Galen’s medicine owe their survival to careful Islamic caretakers. It’s also fairly well known that Islamic scholars during this period made important original contributions to math (algebra is an Arabic word), astronomy, philosophy, and medicine. Of course, the same movement also gave us the word “gibberish” from the name of the scholar Jabir ibn Hayyan, who was as indecipherable in his time as he is in ours. But then, few things in the world are purely good or bad.

Starr has put together a superb intellectual history of the Arabic Enlightenment. He doesn’t quite give literature or the arts their due, but that was intentional. Nor is this a larger survey history of the Arab world during its golden age. Starr instead prefers to focus on philosophy, science, and medicine, and covers them thoroughly, while also paying some attention to art and architecture. He also brings the time’s leading personalities to life. Ibn Sina (b. 980), better known in English as Avicenna, for example, comes across as brilliant, and well aware of it. Starr give him a thorough biographical treatment of both his accomplishments and his personal life. Someone who was previously little more than a name I associated with a period in history became a person with likes and dislike, triumphs, pathos, and flaws.

Other figures get similar treatment, and Starr also tells the story of larger movements, such as Sufism, which came to prominence in Iran’s Safavid dynasty and focused on more ritual and mystic elements. Starr also introduces the reader to the heights of Baghdad’s cultural accomplishments, to the Seljuk Turks on the Arabic world’s western periphery, the terrors of Genghis Khan and his descendants, as well as the economic and intellectual contacts and exchange they made possible

Starr finally carries the story forward well into the 15th century, up to the conqueror Timur (Tamerlane, d. 1405)’s descendants. Most prominent among these was his grandson Ulugh Beg, known as the Astronomer King, who was an accomplished scientist as well as a king.

This is a book I wish I had read years ago. Despite intentionally leaving out major aspects of culture and history, it is wide-ranging. It accessibly covers people, movements, events, and accomplishments that are still largely unknown to a Western audience, including this reader. And it satisfies my economist’s interest in interconnectedness, openness, exchange, and how culture can help or hinder prosperity. It pairs well with Justin Marozzi’s biography Tamerlane: Sword of Islam, Conqueror of the World, which I read around the same time.

Robert K. Massie – Catherine the Great: Portrait of a Woman

Robert K. Massie – Catherine the Great: Portrait of a Woman

Every biographer must make a choice between focusing on the person, or the times they lived in. It is a spectrum, not a binary, but most biographies emphasize one or the other. Here, Massie tilts about as heavily towards the person as I’ve ever read in the biography. This makes for a very good read, and Massie gives an insightful character study. But even in a lengthy book, Massie pays only the barest attention to the major world events and larger context of Catherine’s reign (1762-1796).

Her early reign appeared at the peak of the Enlightenment, and Catherine was an active correspondent with thinkers such as Voltaire. She even imported Diderot, famous compiler of the Encyclopedie, for a short time, before he left on bad terms, feeling stifled and homesick.

Catherine’s situation had a little bit in common with the economist Turgot, her rough contemporary in France just before the French Revolution. Her liberalism did not fall on receptive ground, and in a sense there was nothing she could do. She drafted something of a liberal manifesto, the Nakaz, which she intended to lead to a new legal code. But nothing ever came of it—just as Turgot tried to reform France’s finances and economy in a more or less liberal direction, but ran into a political and cultural brick wall. Catherine, of course, was a monarch who jealously guarded her power, and her liberalism was more relative than absolute.

Massie is a superb biographer, an astute psychologist, a well-developed sense of empathy, and a gifted writer. I might have enjoyed more on Catherine’s circumstances in addition to Catherine as a person, but that may well have required Massie to add a second, even lengthier volume. As it is, this single volume is superb.

Charles C. Mann – 1493: Uncovering the New World Columbus Created

Charles C. Mann – 1493: Uncovering the New World Columbus Created

An excellent, highly readable sequel to 1491, which was Mann’s history of pre-Columbian North and South America. This book looks at the aftermath. Mann dives deep into disease, biology, trade, culture, and more. I learned that earthworms, or at least the species most Americans are familiar with from their gardens, were brought over to the Americas from Europe. Also, nearly all European and Asian potatoes are essentially clones from one of many candidate New World species. Mann’s surprisingly lengthy and surprisingly light-hearted discussion of the guano archipelago off of South America and the economic and geopolitical consequences of its discovery was also something new.

I also learned that an attempt to popularize escargot in Taiwan led to the imported snails escaping and becoming an invasive species. Meanwhile, the dish failed to catch on. The spontaneous orders that emerged in managing this common resource would be of interest to students of Garrett Hardin’s famous 1968 article “Tragedy of the Commons,” as well as Elinor Ostrom’s empirical studies on polycentric governance. Mann himself is also economically literate, accurately using insights from Douglass North, Joseph Schumpeter, and other economists.

Adrian Goldsworthy – The Fall of Carthage: The Punic Wars 265-146 BC

Adrian Goldsworthy – The Fall of Carthage: The Punic Wars 265-146 BC

This is a history of the Punic Wars, mostly from the Roman side. It is not a survey history of Carthage. For that, turn to Richard Miles’ excellent Carthage Must Be Destroyed. Carthage versus Rome was the big rivalry of its day, the Ancient Mediterranean equivalent of Yankees-Red Sox or Packers-Bears, except with rather higher stakes. The temperature ran especially hot on the Roman side of the dispute. Cato the Elder, for example, ended his every Senate speech, regardless of topic, with the phrase “Carthago delenda est” (“Carthage must be destroyed”).

That said, the rivalry has an artificial cast to it. Roman culture placed a heavy emphasis on self-aggrandizement. Virgil’s Aeneid, for example, ties Rome’s origins all the way back to the Trojan War epics of Homer. And every hero needs a villain to fight; Rome’s villain was Carthage. Goldsworthy is a good narrative historian, and though he remains Rome-centric, he gives the reader an idea of Carthage’s origins and why the former Phoenician colony (whence “Punic”) stuck in Rome’s craw so much. He also explains prominent Carthaginians such as Hamilcar and Hannibal’s significance, strategies, and motivations. Finally, Godsworthy also separates the three Punic Wars into distinct entities. They blend together for many people, including me, and this book helped to give a more detailed understanding. This was a multi-generation conflict, and each generation had a different fight.

Nicholas R. Lardy – The State Strikes Back: The End of Economic Reform in China?

Nicholas R. Lardy – The State Strikes Back: The End of Economic Reform in China?

Lardy’s “core conclusion is that absent significant further economic reform returning China to a path of allowing market forces to allocate resources, China’s growth is likely to slow, casting a shadow over its future prospects.” In this case, Lardy largely echoes other recent works such as Elizabeth C. Economy’s The Third Revolution: Xi Jinping and the New Chinese State and Ronald Coase and Ning Wang’s How China Became Capitalist.

China has taken a decidedly dirigiste turn under Xi Jinping. If Xi continues down an increasingly statist path, China’s growth will slow. If market reforms continue, China will prosper. Given the outsize amount of power centralized in his person, this choice is up to him more than anyone else. This will remain the case regardless of whether the current U.S.-China trade war ends tomorrow or continues for years. U.S. presidents come and go, but Xi will likely be around for a long time. And if not him, then someone in his inner circle with similar policy views.

Lardy is an excellent economic analyst, parsing through China’s not-entirely-truthful official statistics as well as international data to give as accurate a picture of China’s trajectory as he can, given the sources. One of his major conclusions is that China’s state-run businesses are severely underperforming compared to the country’s private businesses. State-run enterprises consistently make more and larger losses, are more heavily in debt, and the ones that are profitable tend to be less profitable than their private counterparts. They are also concentrated in legacy industries; China’s growth is less in energy and manufacturing and more in services and technology—precisely where China’s private sector is strongest.

This sounds like good news, but the trouble is that under Xi, the poor-performing state-run share of the economy has been growing. Since government tends to make a hash of whatever it does, if Xi keeps this up, China’s growth will slow. This is an avoidable mistake, but it is an open question if Xi will be willing to admit it.

China has several massive white elephant projects that are wasting precious capital, such as its Belt and Road initiative. While this program and others like it scare China hawks in the U.S., they are weakening China. Government infrastructure projects worldwide are late, overpriced, and often of low quality. The Belt and Road initiative is no different, according to available evidence so far. Moreover, the billions of dollars Beijing is putting into it now cannot put into more productive ventures.

Lardy, like everyone else, is unable to guess which path China will take—state-run and poor, or free and prosperous. Unlike many analysts, Lardy is humble enough to admit that he cannot predict the future. He is hoping Xi will eventually decide to turn China’s policy momentum back towards liberalization. The Chinese people share this hope, and China observers of all stripes should hope the same, whether their politics are hawkish or dovish.

New $7.5 Billion Tariffs against European Union

The Trump administration has announced tariffs on $7.5 billion of goods from the European Union. This time, it is being done with the World Trade Organization’s blessing. Here is what is different about these tariffs—and what isn’t.

The EU gives subsidies to airplane manufacturer Airbus, giving it an unfair advantage over U.S.-based Boeing. So the U.S. filed a complaint with the WTO. The decision came down yesterday. As expected, it was in the U.S.’s favor, since corporate subsidies are fundamentally unfair. As part of the ruling, the U.S. is allowed to enact tariffs against up to $7.5 billion of EU goods to counteract the Airbus subsidies without violating WTO rules. This being the Trump administration, the new tariffs were announced within hours of the decision coming down. But just because you can do something doesn’t mean you should.

Aside from the usual economic objections to tariffs, the Trump administration’s strategy won’t work in a repeated-play setting. Because America’s relationship with the EU is longer than a one-time interaction, the new tariffs will soon do more harm than simply make some consumer goods more expensive.

Boeing gets subsidies of its own from the U.S. government, and the EU has its own WTO complaint pending about that. Corporate subsidies being fundamentally unfair, the EU will likely win. It will then likely have the option to put up its own additional tariffs against U.S. goods. If this next round of the repeat-play game plays out as expected, both Airbus and Boeing will continue to receive subsidies, same as before. Moreover, two new tariff increases will harm consumers and businesses on both sides of the Atlantic. At this point, the Trump administration’s latest tariffs will have caused double harm. Again, just because they can enact a new tariff doesn’t mean they should.

As has happened in almost every instance of the trade war so far, Trump’s opponents are using a tit-for-tat strategy. His tariff hikes are not met with the reforms he wants. They are responding in kind with their own tariff hikes. Trump’s tariff hikes reliably cost both Americans and our trading partners double.

Also worth noting—Airbus gets about 40 percent of its parts from the U.S. and has a factory in Mobile, Alabama. While all tariffs harm the country that enacts them, this one will cause more direct harm.

For more, see Iain Murray’s and my paper “Traders of the Lost Ark.” My recent paper on the Export-Import Bank, known around Washington as “Boeing’s Bank,” sheds some light on Boeing’s subsidies that may soon lead indirectly to yet more tariffs on U.S. businesses and consumers.

Andrew J. Newman – Safavid Iran: Rebirth of a Persian Empire

Andrew J. Newman – Safavid Iran: Rebirth of a Persian Empire

The Safavid dynasty was one of the most liberal periods in Iranian history. Iran, of course, was not a nation-state in today’s sense of the term until the 20th century. Safavid territory also included Baghdad and ranged up north into Afghanistan, several of the steppe countries and parts of Georgia, including Tiflis (now Tblisi), and ranged east almost as far east as Bukhara. It lasted from about 1510 to 1722, with a few dying embers lasting until 1736, a little bit like post-Louis XVI Bourbons.

For context, the Safavid dynasty ranged roughly from just before Europe’s Reformation and post-Columbian exploration age through the Scientific Revolution and the early Enlightenment. It began roughly a century after Tamerlane conquered most western and northern Asia. China’s Ming dynasty reached its peak and was overthrown during the Safavid era. The most famous Safavid monarch was Abbas I (reigned 1588-1629, roughly contemporaneous with Shakespeare, the second half of Elizabeth I’s reign, and her successor James I). But the generations before and after Abbas I were also comparatively liberal. One of the few opinions Newman ventures is that the Safavids were not a one-hit wonder with Abbas I as the dynasty’s only notable head.

The regime’s official religion was Twelver Shi’ism, which was an important development in Islamic history. But by the standards of their time, the Safavids were highly tolerant of both other kinds of Islam and non-Islamic religions. They compared favorably to both the Europeans of their time and the Iranian government in ours.

Art, architecture, poetry, and literature thrived, both in court and among regular people. Despite ongoing tensions with the Ottomans to the East and limited direct ties to Europe, an openness to trade also made Safavid territories prosperous enough where high art and exotic goods were affordable even to the middle class; even in Europe such things as single-page prints were still mostly the province of the wealthy. At the same time, the Safavid Dynasty was founded on military power, survived by the sword, and ultimately died by it. Its liberalism was in comparative, not economic terms. It is a complex, multifacted period, and was interconnected with what was going on in Europe, Turkey, Russia, India, and China.

Newman’s book is drily written, focusing heavily on kings and battles, and names and dates. If the reader enters with some knowledge of world history from 1500-1700, and a willingness to Google new names, places, and terms, they can tease more insights out of Newman’s narrow and literal focus. His grayscale portrait could have used some color. Unfortunately, English-language histories of the period are hard to come by, so Newman it is. Readers are mostly on their own for discerning the Safavid dynasty’s larger significance and context, and are rarely given interpretations to agree or disagree with. This was still a profitable read, but requires a more active approach on the reader’s part than most books.

Ian Kershaw – The Global Age: Europe 1950-2017 

Ian Kershaw – The Global Age: Europe 1950-2017 

Kershaw is best known as a historian of Nazi Germany, and the author of the definitive two-volume Hitler biography. More recently, he has turned his focus to modern Europe more generally. This book concludes a two-part series. The first, gloomier half is To Hell and Back: Europe 1914-1949; this volume is rather sunnier.

Major themes early in the book include the fall of the Iron Curtain and rapid nuclear armament, along with all the tension and unease those developments caused. I was previously unaware of the scale of post-war migration to escape socialism. East Germany lost about 2 million people to West Germany during the 1950s, with an average of 2,300-2,400 people escaping daily until the Berlin Wall was finished in 1961.

As the book goes on, the reader realizes how deep the scars of 20th century’s first-half tumult run. The very reason for the formation of the European Community and its various iterations on up to the European Union was to prevent another world war. In line with thinkers from Montesquieu in the 18th century on up to Cordell Hull in the 20th, have argued, close trade and economic ties help to maintain peace. Economic integration will make war so costly that no country would dare attempt another round of Napoleonic conquest or, more to the point, a Third Reich.

This argument is deeply felt throughout the continent at a visceral level, something most American observers don’t see. The EU’s agricultural and regulatory policies have few defenders, but then those aren’t the EU’s raison d’etre. Understanding that dynamic is essential to understanding the Brexit debate and other debates about the EU’s future. It does not hinge on a socialism-vs.-markets debate. For most of the debate’s participants, it is instead about nationalism-vs.-cosmopolitanism, or more fundamentally, how best to prevent another World War II.

Even the Cold War was largely an echo of World War II. Most of the continent was overtaken by one of two forms of totalitarianism; communism just happened to be the one that lasted longer. In the post-war Stalin and Khrushchev years, the Soviet bloc was a feared nuclear enemy, requiring NATO and extensive U.S. involvement to keep it at bay.

But as time went on, Brezhnev-era political sclerosis took its toll while the more market-oriented West grew. The Soviet threat became gradually less scary and less stable. By the Gorbachev era, the thinking went from how to deal with nuclear fallout to how to deal with the political and economic fallout from communism’s coming collapse. An American reader might see the Europe-Russia relationship under Yeltsin as a little bit like the dynamic between the Griswold family and Uncle Eddie in the National Lampoon’s Vacation movies.

Kershaw is more of a political historian than a social one, so everyday life for ordinary European people is not the focus here. Music, fashion trends, and art are mostly cordoned off into separate short chapters throughout the book, roughly one per decade. If you want to know what it was like to live there during this period, go elsewhere. But Kershaw is excellent at identifying larger historical themes and seeing how they interact and play out. Kershaw is also a talented prose stylist; this book reads quickly and easily enough for the reader to forgive its 700-page length.

Kershaw also clearly lacks substantive background in economics. He shows this in his frequent use of the term “neo-liberal,” which has no coherent definition. It is nearly always used as a pejorative, though Kershaw’s usage ranges from neutral to mildly negative, further adding to the confusion. In discussing trade issues, Kershaw adheres to the balance of payments fallacy, which would flunk him out of a freshman introductory economics course.

He also does not grasp that John Maynard Keynes and Milton Friedman’s differing monetary policies share a common conception of the quantity theory of money. They part ways on the ought, not so much the is. In addition, Kershaw cites Friedman’s Capitalism and Freedom as Friedman’s statement on monetary theory. That book contains just one chapter out of thirteen on monetary issues. Friedman’s 800-page Monetary History of the United States, coauthored with Anna Schwartz, was his definitive work, the leading cause of his Nobel Prize, and is hardly obscure.

So long as one takes Kershaw’s attempts at economic theory and policy analysis as seriously as they deserve, this is an excellent survey of a neglected area of history that is impacting everything from today’s Brexit debate to trade relations with the United States to how Europe will deal with the rise of China as a major power.

U.S.-China Trade War and the 2020 Election

I just saw this now, but I was quoted in an August 13 U.S. News & World Report article on China tariffs:

“The administration has been saying otherwise, but it is good to see that they do not believe their own words,” Ryan Young, a senior fellow at the libertarian Competitive Enterprise Institute, said in a statement Tuesday. “Several rounds of China tariffs have so far failed to encourage the Chinese government to make needed reforms. Beijing has instead consistently retaliated with its own trade barriers, hurting the U.S. economy as well as its own.”

Read the whole thing here.